The Political Economy of COVID-19

BY KAYODE KOMOLAFE

Two days ago, Cuba gave permission to a British cruise ship with Coronavirus Disease (COVID-19) patients on board to dock within its territorial waters.
By this exceptional act, the struggling Caribbean Island is teaching the rest of the world some lessons about our common humanity.
These are profound lessons that cannot be explained by narrow political and economic calculus. In fact, the nation of Cuba is rewriting the diplomatic rules in its own humane way.

On the British cruise ship are five passengers among 600 voyagers who have tested positive to coronavirus. Several countries that are friendly to Britain had turned away the British ship. For two days, the ship remained stranded on the sea seeking a place to dock.

The British government finally sought help from Cuba. Now, in diplomatic history the United Kingdom could not be accused of being a great friend of Cuba in the face of the asphyxiating 60-year old blockade mounted against the tiny country by the powerful United States.

Yet on Monday, the Cuban foreign ministry said in a highly compassionate statement: “Given the urgency of the situation and the risk to the lives of sick people, the Cuban government has decided to allow the docking of this ship.
“The passengers will be repatriated by air to the UK and their home countries…
“These are times of solidarity, of understanding health as a human right, of reinforcing international cooperation to face our common challenges, values that are inherent in the humanistic practice of the Revolution and of our people…”

Besides, Cuban doctors are on ground in Italy along with Chinese experts to tackle the coronavirus which has kept the European nation on a lockdown.
These Cuban doctors, exemplars of our common human humanity, are in Italy at the request of the Italian government.
Cuba has also sent supplies of Interferon B to Italy to treat patients. The drug has helped in treating patients China. It is produced in a joint venture as part of an agreement between the two countries.

The example of Cuba is conspicuous amid the panic that seems to be defining the global response to the ravages of COVID-19.
Contrast the foregoing anectode with the following one. There is a German company called CureVac that is researching into the production of a vaccine against coronavirus. American President Donald Trump has reportedly offered CureVac funds “to lure” the company to relocate into the United States.
Essentially, the Germans are alleging that Trump wants to “secure the scientist’s work exclusively,” so that the vaccine could be produced “only for the United States.”

This, of course, has drawn the ire of German politicians. Germany is reportedly taking steps to stop the American moves. In the reasoning of German politicians, no country should have a monopoly on the production of vaccine to combat COVID-19.
In fact, Germany is believed to be making counter-offers to the company.

A spokesman of the German Health Ministry is more explicit about what is happening: “The German government is very interested in ensuring that vaccines and active substances against the new coronavirus are also developed in Germany and Europe.

“In this regard, the government is in intensive exchange with the company, CureVac.”
Invoking German foreign trade laws, an official of the German Economy ministry was quoted in Berlin as confirming that Germany “has a great interest,” in producing vaccines in Germany and Europe.

Germany is, therefore, examining the alleged takeover bids from a non-European Union (EU) country to see “if national or European security interests are at stake.”
The German mood on this matter is, perhaps, encapsulated in the words of a German social democrat law maker, who is also a professor of health economics and epidemiology: “The exclusive sale of a possible vaccine to the USA must be prevented by all means. Capitalism has limits.”

An American official has been quoted as saying that: ”This story is wildly overplayed… We will continue to talk to any company that claims to be able to help. And any solution found would be shared with the world.”
As they say, there is no smoke without fire. There is the information on the website of CureVac that the company’s CEO Daniel Menichella “ recently met with Trump , Vice President Mike Pence and other White House officials.” This was during the American government parley with pharmaceutical companies on the production of a vaccine against coronavirus.

Well, there is a relief on the COVID-19 horizon. CureVac hopes to produce an experimental vaccine of a coronavirus in June or July, said it would develop the vaccine to “help people not just regionally but in solidarity across the world.”
The company is not about to be acquired, according to its spokesman, who said no offer has been received from the U.S. or any other country.
The COVID-19 stories above point to the fact that the economics and politics of coronavirus may even be more problematic than the epidemiology and virology of the disease.

World Health Organisation (WHO) Director-General Tedros Adhanom Ghebreyesus has already hinted even on an aspect of the sociology of COVID-19 when he spoke about an “infodemic, ” the sheer volume of disinformation, mass distraction, fake news and mischief that pollute the cyberspace in the name of freedom of expression. There is a proliferation of online “experts” in the matters of COVID-19. The precautions against infection being promoted by health authorities are also in the realm of the sociology of the people – social distancing, form of greetings, attendance of ceremonies and congregations etc.
While the epidemiologists and virologists are busy studying the nature and implications of coronavirus in the laboratories, some politicians and businessmen are intensely involved in the economic calculus and the political game being played with the disease.

There is a lot of danger in the way some western politicians seem to be manipulating the poltical economy of COVID-19.
For instance, what was the scientific sense in Trump first announcing a travel ban on Europe while excluding the UK and Ireland? The American president seemed to forget that coronavirus doesn’t recognise the historical “special relationship” between the U.S. and the UK as wells as Trump’s ill will against the unity of EU. The lack of science in Trump’s decision was proved when a few days later the ban was extended to the UK and Ireland.

As if to prove the point that the economics of COVID-19 is as important as the science of the disease, the Trump administration is asking the Congress for a new stimulus package of between $800 billion and $850 billion to mitigate the damage of coronavirus to the American economy. The government may be sending money directly to the citizens as “emergency financial aid.” Experts regard this as a more aggressive economic policy to a disease that is crippling the aviation, hospitality and manufacturing sectors even in the developed countries.

The health crisis is now coupled with an economic crisis. The interplay of forces is such that the health and economic crises are mutually reinforcing to the monumental detriment of people’s welfare.
The UK is planning to launch a 330 pounds rescue package for businesses as it fears that the impact of the virus outbreak may linger on the British economy for another one year. In other parts of the world, governments are seriously working on how to limit the negative economic consequences of COVD-19 especially on the poor people.

A Republican senator in the U.S., seemed to define the nature of the response required at this moment when he said that ”there is an absolute need for a government in times of crisis…”
Nigeria has a lot to borrow from other countries in its response to the present health emergency.
The health authorities in Abuja and the state capitals should improve on the efforts to prevent the spread of the virus in Nigeria while preparing more concretely for any eventuality. The official figure of the cases recorded in the country is relatively low compared with those of the other countries wrestling with the pandemic. The official figure of three cases should not choloroform Nigeria’s alertness about the virus. There should be no complacency.

The economic managers at the federal and state levels should roll up their sleeves for the economic crisis that may result from the scourge. Nigeria’s problem is further problematised by the slide in the oil price. Some pundits even forecast a drop in oil price to $20.

In this context, the policy step taken by the Central Bank of Nigeria (CBN) a few days ago is welcome. The policy measures are meant to boost economic confidence which is vital in mitigating the effects of a possible crisis in the economy. From this month, a -year moratorium has been further granted in all principal repayments while interest rate is reduced from nine per cent to five percent. Notably in the package, a N50 billion facility through the Nigeria Incentive-Based Sharing System for Agricultural Lending (NIRSAL) has been put in place. It is meant for households and small and medium scale enterprise that could be affected by the consequences of COVD-19.

The fiscal authorities should also come up with concrete policies that could reassure economic actors that the Nigerian poltical economy is in the hands of safe managers as people try to keep safe from coronavirus at the individual levels. Finance Minister Zainab Ahmed seemed to give a hint that a comprehensive policy package was afoot at the recent roundatable with the CBN governor, Godwin Emefiele.

A comprehensive economic package that would be informed by the reality of the situation should be put in place by the economic managers.
The National Economic Council, created by the constitution, should be involved as the package is being put together because the state and federal governments should work with unity of purpose to stave off the economy from the path of crisis. The implementation of some of the policies may require a replication of efforts at the state levels so as to mitigate the impact on the poor.

In tackling this crisis, the minsters of finance and health may turn out to be the busiest officials of governments in the months ahead.
Beyond the political economy of COVID-19, the most profound lesson of the moment is the recognition of the onesness of mankind, a moral asset needed in confronting the pandemic.

There are still great uknowns about COVID-19. The world is virtually on lockdown. The west is closing its borders.
Yet, the implication of the WHO’S declaration that coronavirus is a pandemic is a universal one. The virus does not recognise the narrow economics and politics of man. A few weeks ago, China was the epicentre of COVID-19. There was a ferment of prejudice against the Chinese people following the declaration by the WHO. In a very unscientific manner, coronavirus was stereotypically branded a Chinese problem in some quarters.
The same WHO has now declared Europe as the new epicentre of the scourge.

That’s why the commonality of mankind should always be emphasised in the global efforts to tackle the disease.
This situation calls for cooperation among countries and global organisations. It’s not a time to engage in some crude economic and political competition. For whatever the trophy of such a mindless competition might be, the cost would certainly be human lives and well-being of the people especially the poor.

Above all, the virus replicates rapidly. The information about its nature and spread should be collectively shared for the purpose of global eradication.
So, the government should realise that a keen sense of time and truth telling are essential ingredients in policy-making at this time.

QUOTE
“The economics and politics of coronavirus may even be more problematic than the epidemiology of the disease”